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Public don’t trust pension pledges

Over three-quarters of the public do not trust the Government to deliver on its pension promises, according to research from the ABI.

Only 19 per cent trust the Government to match its pension pledges while 78 per cent do not. Acceptance is growing that individuals will have to work longer to fund a comfortable retirement, with a substantial minority saying Government initiatives to extend working life are likely to delay their retirement.

The research shows 41 per cent believe the new rules allowing people to receive a lump sum if they delay taking their state pension will encourage them to work longer. Forty per cent say the more generous rules on state pension increments paid to people who delay taking their state pension and who do not take the lump sum option will also encourage them to work longer.

Thirty-seven per cent say the simplification rules which enable individuals to claim an occupational pension while continuing to work part-time are also likely to see them work beyond normal retirement age.

Earnings continue to drive people’s savings habits, with 62 per cent saying that their pension contribution levels are driven by what they can afford.

ABI head of pensions and savings Joanne Segars says: “This proves that the pension industry and the Government need to work even harder to persuade people of the need to prepare for retirement.

“Reform of the state pension system, in particular through reducing means testing so that people can fully benefit from their pension saving, is an essential part of this process.”

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